We typically don’t default to trusting those we don’t know, especially when we find it so difficult to trust well those we do. So it shouldn’t surprise us when the Center for Effective Philanthropy reports that one of the central problems in modern philanthropy is a “pervasive lack of trust” between foundations and grant recipients. This lack of trust is largely the result of a knowledge deficit, revealed in grantees’ complaint that those offering the grants need to learn to defer to those who live in, know, and understand a region.

People who get into the nonprofit sector typically do so because they are trying to promote, defend, enrich, or maintain something they love, and these loves form the backbone of any worthwhile enterprise.

Funders, on the other hand, may or may not have the same love, and the natural power and dependency imbalance of giver-recipient relationships may quickly skew operations. The funders would have a tendency to either dictate practices that run contrary to the demands of love, or insist on “measurables and metrics” that take love out of the equation.

The authors of the report note that “in the drive toward measurement and metrics, talking about relationship building as a measure of impact may seem suspect.” As I argued in a prior piece at Philanthropy Daily, The Problem With Measurable Impact, metrics are often used to run a shortcut around relationships, but do so poorly.

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Giving Compass' Take:
• In this Grantmakers for Effective Organizations post, nonprofit leaders share what grantmakers can be doing to support grantees in more meaningful ways.
• The upshot is support goes beyond dollars. Capacity building, trust and equity must be at the core of the work funders do, making sure that every voice is heard in the process.
• Here's more on how grantmakers can be true partners.
We are a diverse group of nonprofit executives who have spent the last 18 months coming together to explore how philanthropy can better support nonprofits to create real change as members of Grantmakers for Effective Organizations’ Nonprofit Advisory Council.
We appreciate the ways in which philanthropy has been shifting in recent years — toward longer-term grants, collective learning, and engaging us and the communities we serve in decision-making. The momentum is rolling in the right direction.
And there is so much more we can do to create greater outcomes if grantmakers and nonprofits push the boundaries of what it means to partner.

Any nonprofit organization is an immensely complex collection of complex persons trying to work together in a complex situation. Navigating that complexity requires an intimacy of knowing that donors rarely possess (although counter examples might be found in education and the arts). One should give modestly, not in dollars but in demands. The donor should start by yielding to the grantee. As one recipient put it: “Being of and around wealth does not a deep-community-knowledge make. Humility yields many, many great things.”

The report highlights the conduct of particularly good program officers whose common trait was “deference.” They didn’t assume they knew the organization’s needs better than those running the organization. They listened carefully. They let clients know that funding was not to be purchased by nonprofits adjusting their missions or practices to pander to the foundation.

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